IVCA Profile: John Flavin, Founder & CEO of Portal Innovations, on Life Science and Biotech Initiatives

February 17, 2021

With the implementation and rollout of the COVID-19 vaccines, the umbrella industries under the terms Life Sciences and Biotech again were in the spotlight. Much of the research and development is within the grind of lab work, and Portal Innovations is leading the way in providing shared wet and dry labs for Life Sciences, Medtech and Bioinformatics companies, as well as bringing together entrepreneurial teams, global capital and industry partners to accelerate the associative innovations.
John Flavin is the Founder and CEO of Portal Innovations, after serving as CFO at Endtronix, while also cofounding Pyxix Oncology. Over his career, he has co-founded and scaled several companies as President and CFO, including Advanced Life Sciences and Medichem Life Sciences. He is also involved in Life Science incubators, co-founding MATTER (for global healthcare start-ups, headquartered at the Merchandise Mart) and the Policy Center for Entrepreneurship and Innovation at the University of Chicago.
The IVCA talked to John Flavin to reflect on the current iterations in Life Science and Biotech investment and industry.
IVCA: You launched Portal Innovations last March, right before everything changed. What was the advantage of having your infrastructure in place as the pandemic took hold?
John Flavin: It was an interesting time to launch to say the least. However, as it turns out, the pandemic cast a spotlight on the need for more biomedical innovation and the capital markets remained accessible. Several new $1B+ life sciences VC funds were raised and the IPO window is wide open. This capital has flowed into more Life Sciences start-ups and is being distributed, not only in the hotspots like Boston and the Bay area, but it’s seeking places that are ripe for investment such as Chicago.
With more viable start-ups in the region, there is increased demand for space. This backdrop set the stage for Portal opening its first lab one year ahead of schedule on the new Fulton Labs campus. Having strong capital and development partners that were able to see the opportunity through the pandemic, Portal is now positioned to deploy its model sooner than planned.
IVCA: What is interesting is that it was due to the pandemic, correct?
Flavin: The pandemic really brought into focus the importance of biomedical research/development and the infrastructure/logistics that is critically needed in order to deliver new medications and treatment options. In addition, the pandemic really allowed everyone to come together and work on one problem; we were no longer comparing American cities and/or institutions against one another. The pandemic made us realize that innovation and cutting-edge science really comes from everywhere.
We were fortunate in that the infrastructure was in place when the pandemic hit because we were able to continue to work towards the official launch of Portal and to continue to bring biotech startups, capital and lab space together to make an ecosystem in the West Loop, near Rush, UIC and the Illinois Medical District.
IVCA: Given our last year with the pandemic circumstance, Life Sciences became vital in both the quest for the vaccine and the investments to make it happen. In your point of view, how far has the financial branch of Life Sciences evolved in the last year?
Flavin: According to a report from Silicon Valley Bank which tracks life sciences VC activity, the first half of 2020 produced the largest two-quarter investment total ever for venture-backed healthcare companies, despite financial market turbulence and setbacks to company product development, clinical trials, and revenues caused by COVID-19. The second half of the year was equally active.
Life Sciences is attracting more capital from a more expansive LP pool and VCs due to the decreased time from series A to exit now happening on average in under three years. This trend is expected to continue because, in many instances, science is improving the success rate from discovery to FDA approval especially in new modalities such as mRNA. This was seen with Moderna with their COVID-19 vaccine, from discovery to FDA approval in ten months. Other modalities like cell and gene therapies also have a shorter path from discovery to patient in many cases.
The pandemic circumstances made everyone more aware of what actually went into drug development … from the science to the actual costs, to the gathering of clinical trial volunteers and how many approaches are needed to get one vaccine approved. Most importantly, it got everyone talking about the minute details about the different technologies used in the vaccines and really engaging in biotech in a very intimate way. I believe it got the general public really invested in developing new technologies that actually have real impact. The financial market is responding to that, both in terms of private and public capital.
IVCA: One of the more interesting partnerships for Portal is with Trammell Crow Company, a real estate company, to partner in the building of wet and dry labs to further research and development. What are the origins of that partnership, and how does it distinguish the Portal launch?
Flavin: To launch a venture development engine for life sciences like Portal is doing, you need access to three forms of capital that can be provided to new ventures: Knowledge … the talent and assembly skills to build a life sciences company, Financial … cash to invest in and lead seed rounds to build the initial team and establish proof of concept, and Physical … fully equipped wet and dry lab space to carry out the scientific operations of the venture.
We have historically lacked the lab infrastructure, so this was necessary to be addressed for Portal to launch in Chicago. For example, there is currently five million square feet of lab space fully utilized in Chicago, mostly antiquated and on academic campuses. In Boston, there is approximately 30 million square feet at full utilization.
IVCA: And that’s where Trammell Crow came in?
Flavin: There have been a number of projects being discussed around the city to address this shortage but when conversations started with Trammell Crow (TCC), it was very clear to me that they are the right development partner. The reasons were they are building Fulton Labs in a highly active ecosystem populated with companies like Google and nearby Tempus … where data scientists and computational biologists and chemists like to live, work and play. They also have a bold vision that leverages bricks and mortar to build a vibrant ecosystem. And most importantly, the project was not just being discussed, it was real and happening in a timeframe that met Portal’s needs.
TCC really embraced the vision and actively worked to make it a reality. The team behind TCC have been amazing to work with and eager to learn alongside us as we work towards Portal’s launch.
IVCA: Life Science/Biotech are broad terms. In your purview, how do you define those terms, as far as what Portal Innovations is pursuing with your leadership?
Flavin: Portal will focus on the convergence between therapeutics, bioinformatics, and medtech, which are AI (Artificial Intelligence) enabled life sciences. Bringing together math, materials science and biology is where Chicago and the region have notable strengths … considering the dense industrial and academic talent pool and supercomputing assets at the universities and nearby national labs.
I would expect to see investments in companies developing biomaterials as therapeutics, gene/cell therapies, and an emphasis on immunology as an area of regional clout, especially the microbiome as it applies to several disease areas including allergy, neurology, cancer and infection.
Given recent advances in medicine, we truly are at a biomedical renaissance, and from this we are starting to realistically speak about cures for diseases, not just treatments. Biotech/Life Science are such an exciting industries to be in.
IVCA: You are a co-founder, mentor and development manager with top universities through your incubator MATTER and the UChicago Polsky Center/Chicago Innovation Exchange. What can you report about the work on the university level in biotech and life sciences, in both investment possibilities and societal evolution?
Flavin: The Chicago Life Sciences ecosystem has come a long way over the past decade thanks to civic life sciences entrepreneurship and innovation platforms like MATTER, mHUB, NU/INVO, the Chicago Biomedical Consortium and the Polsky Center.
Over the last five years, universities have dramatically increased their sophistication in supporting Life Science ventures with programmatic and financial support. Following the initial successes of early ‘Gap Funds’ like Harvard's Blavatnick Fund and UChicago's Shultz Innovation Fund, now almost every major university has launched its own fund to support early stage biotech, such as other notable approaches including Northwestern's NewCures and the University of Wisconsin’s WARF Therapeutics. There is a lot of innovation currently happening as universities determine how to best support and invest in their own unique communities.
IVCA: How has this Chicago and regional push changed these universities?
Flavin: In Chicago and the central U.S. these investments have attracted a new type of faculty to the ecosystem; Faculty that are developing applied innovations which have commercial promise and are ‘investable.’ But, universities and civic incubators can only take ventures so far before the market needs to take the baton. As ventures prepare to leave the university, the are confronted with three hard questions …
- Where do I find an experienced business person to shepherd the company full-time?
- Where do I find the physical infrastructure and equipment – such as lab space – that I need for the next stage of growth?
- Where do I raise the next round of funding, to keep food on the table?
Portal is our vision for how to answer these questions in the central U.S. We are investing ‘crafted capital’ in these three critical forms.
IVCA: Finally, as a lifelong innovator and leader in the Biotech/Life Sciences field, how can the Illinois Venture Capital Association contribute in both mentorship and their resources to the field?
Flavin: I would suggest providing a welcoming environment for more VC firms exploring the region. Also increase programming to include Life Sciences investing and venture development. Of course, promoting awareness of this growing part of the community, which ultimately supports tech investing given the convergence between AI and Life Sciences.
We could help the future by supporting a pipeline of emerging scientists and business-minded individuals through sponsoring apprenticeship/internship programs for high school students and college students … perhaps piggy-backing on the recently announced Walder Ventures founding sponsorship of Portal. And encouraging investment in biotech startups by prompting the Illinois Qualified New Venture investment program, and expanding upon that by sponsoring infrastructure developments in the area.
We will be happy to convene and support such initiatives at Portal, our doors have been open since last March and will be open in the years to come.
For more information click on Portal Innovations.